The theory of network formation developed for the cationic polymerization of diglycidyl ether of Bisphenol A was modified for the presence of a reactive diluent gamma-butyrolactone and tested by comparison with experimental results. It was shown that the theory predicts quite reasonably the structure evolution during polymerization characterized by growth of the polymer fraction, gelation, increase in gel fraction, as well as the equilibrium rubber modulus of cured samples.